Understanding Energy Efficiency & How to Save on Electric Bills

Energy Efficiency Simplified

Efficiency is calculated as the ratio of amount of work when compared to the energy supplied.

Efficiency = Work / Energy


Drastically reducing the amount of energy to do the same amount of work, results in a much higher yield, i.e. higher efficiency.

 Leading With Light

Efficiency = Lumens / Watts

One of the simplest ways to increase efficiency in your business is by transitioning to LED lighting. LEDs use less wattage to produce the same number of lumens (light) as incandescent bulbs, fluorescent tubes or CFLs. As we all know, wattage use directly correlates to the amount of money we pay the electric company each month. Thus, striving to reduce that factor is a no-brainer.

LEDs use fewer watts, and, therefore, cost less money to operate!


Example of LED Lighting Efficiency Equation, according to the U.S. Department of Energy:


Work expressed as Lumens (lm) | Energy expressed as Watts (W)


‘Staggering’ Consumption Directly Reduces Cost

 Your electric company measures energy usage according to how many kilowatts you use per hour (kWh), as well as measuring your peak demand usage.

Kilowatt-hour = Kilowatts * Hours

Cost = Rate * Kilowatt-hour

According to stem (www.stem.com), demand charges account for about 30-70% of your total electric bill. Since a portion of your energy bill is comprised of incurring charges at a rate based on your highest consumption in a 15-minute period of time (demand), it only makes sense to ‘stagger’ your usage across multiple hours, therefore, lowering your demand and reducing your total cost.

Implementing Efficient Technology

Transitioning to LED lighting and reducing peak demand through staggering consumption will directly reduce your energy costs. Clean energy technologies are readily attainable through leveraging tax credits, taking advantage of subsidies, and financing larger projects to allow your savings to pay for the project. Stay tuned for additional information on how taking the initiative on becoming efficient in your business can be both economically rewarding for yourself and beneficial for the environment surrounding you.

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